An ambitious £350million bid would see Scunthorpe hospital rebuilt on a new site in the town.
A town centre site has been identified by North Lincolnshire Council, and is being acquired using Towns Fund cash.
The New Hospital Programme has committed the government to building 40 new hospitals in England by 2030, with a £3.7billion budget available.
Eligible schemes can include brand new developments, new clinical buildings or new wings for existing hospitals.
The Scunthorpe project is the top priority in a £720million proposal put together by Humber hospitals, and health bosses hope to deliver a facility that is fit for the future.
The new hospital would have improved access, and would include separate emergency and elective hubs. The bid also aims to deliver research and training facilities.
A brownfield site in Scunthorpe has been located for the new build – the purchase of this land made up a major part of the Towns Fund bid submitted last year.
North Lincolnshire Council leader Councillor Rob Waltham said: “This is a very exciting development, particularly with our town’s project making up nearly half of the entire bid.
“The scheme will hopefully deliver a hospital that is suitable not just for today’s technology, but for five or seven years down the line.”
The government says it expects to announce which bids have made it through an initial selection phase before the end of the year.
The bid also includes a £120million plan to partial-rebuild of Grimsby’s Diana, Princess of Wales Hospital. This is the lowest priority of the four projects in the bid.
The scheme hopes to improve access and increase care quality, and would also see the development of split emergency and elective centres.
A £250m package of redevelopment projects at Hull Royal Infirmary (HRI) and Castle Hill Hospital in Cottingham have also been proposed.
Ivan McConnell, director of Humber Acute Services, told Local Democracy Reporters: “Our proposed investment programme will enable us to provide a hospital estate that is smart, flexible, able to cope with serious outbreaks of infection and the effects of climate change by being energy efficient and environmentally sustainable.
“Our current infrastructure has not coped well during the Covid-19 pandemic. Infection prevention and control measures have resulted in reduced bed numbers, treating patients in pop-up facilities and other sub-optimal solutions.
“Backlog maintenance across our sites totals £105m and in some instances over 82% of our infrastructure is at risk of imminent failure or requires major repair or replacement
“Our proposals do not implement a like-for-like hospital build. Instead, they will deliver smarter, more flexible buildings, split unscheduled care from elective and day case work, deliver single rooms, isolation rooms and small bays to optimise patient flow.”